MGE reaches ‘milestone’ as it completes financing for Inspire integrated resort

MGE, developer of integrated resorts, has closed the financing to develop the Inspire Entertainment Resort on Yeongjong Island in Incheon.

Mohegan Gaming & Entertainment, developer of integrated resorts, has closed the financing to develop the Inspire Entertainment Resort on Yeongjong Island in Incheon, South Korea. 

Set to open its doors in 2023, Inspire Entertainment Resort from MGE is set to become the largest IR in Northeast Asia once completed.

The aggregate funding of $1.55bn will be used in Phase one of development for the IR, generating an anticipated spike in visitation to the region and a revival of the South Korean tourism industry following the COVID pandemic.

James Gessner Jr., chairman of The Mohegan Tribe and MGE Management Board, said: “We have a proven track record in developing and operating leading integrated entertainment resorts in North America with our successes in Connecticut, Las Vegas and Niagara Falls, and we look forward to taking this success abroad as the first American IR launched in Korea.”

The development of the resort is underway within the IBC-III region of the Incheon International Airport, Yeongjong District, Incheon Free Economic Zone, with the current construction completion progress at approximately 12 per cent. 

The Phase one resort development includes three five-star hotel towers, a 15,000-seat multifunctional professional performance arena, a foreigners only casino, the largest convention facility in the Seoul metropolitan area, a “world class” retail offering, a year-round indoor water dome experience and a large outdoor thematic space, known as the “Family Park”.

Furthermore, Inspire Integrated Resort, MGE’s Korean subsidiary, now has in place the funding needed for the completion of construction of the project, which includes a total of $575m in equity combining MGE’s $300m investment and the $275m raised through global private equity firms, Bain Capital and MBK Partners.

Moreover, the funding includes a 1.04 trillion Korean won project finance loan – approximately $890m U.S. dollar equivalent – raised through a three-bank Korean consortium including KB Securities, NH Investment & Securities and Hana Financial Investment, with the participation of Korean financial institutions and with Kookmin Bank as facility agent to the loan. 

The general contractor for the project is Hanwha Engineering & Construction, having provided a completion guarantee as well as a subordinated investment in the amount of 100bn Korean won – approximately equivalent to $85.5m. 

Hanwha Hotel and Resort is also participating as a strategic partner of the project and as the hotel operator.

“We anticipate a significant rebound in the tourism and leisure industry following the pandemic, and we look forward to contributing to the Korean economy while at the same time opening and operating a successful, state-of-the-art resort,” added Bobby Soper, international president for MGE. “I’m thrilled to see our international vision for IR development reach this important milestone.”